Top three players account for 55% of total market

[Pages:3]Cloud infrastructure market grows 47% in Q1 2018, despite underuse

Palo Alto, Shanghai, Singapore and Reading (UK) ? Friday, 27 April 2018

Worldwide spending on cloud infrastructure

services continues to grow, reaching US$17

Cloud infrastructure market grows 47% in Q1 2018, despite underuse - via @Canalys

billion in the first quarter of 2018. This represents a 47% increase on the same period last year. Amazon Web Services (AWS) stayed ahead of the competition, up 49% this quarter. The market

leader's revenue is nearly double that of its nearest competitor, Microsoft (up 93%), which

continued to grow faster than AWS. Google was ranked third, up 89% to US$1.2 billion.

Top three players account for 55% of total market

Worldwide cloud infrastructure services Q1 2017: US$11.5 billion Q1 2018: US$16.9 billion Growth: 46.8%

Market share

35% 30% 25% 20% 15% 10%

5% 0%

Q1 2017

AWS Q2 2017

Source: Canalys estimates, Cloud Analysis, April 2018

Microsoft

Google

Q3 2017

Q4 2017

Q1 2018

Cloud adoption has been a key part of businesses' digital transformation strategies due to its multiple benefits, including elasticity, scalability, on-demand provision of virtualized and container resources, and low upfront costs. But complexity and uncontrolled user access to cloud technologies has led to customers underusing paid-for services and not fully realizing the return on investment. "According to a Canalys survey of 146 channel partners around the world, over 80% of respondents believe their customers' cloud expenditure is not fully used," said Daniel Liu,

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Research Analyst in Canalys. "58% of partners believe up to 20% of their customers' cloud investment is wasted, while 26% think the wastage is more than 20%."

Over 80% of channel partners see cloud wastage

What percentage of your customer's cloud services spending is not used?

None, most have good visibility and are not wasting anything 16%

More than 40% of spending is wasted 13%

Between 20% and 40% is wasted 13%

Less than 10% of spending is wasted 28%

Between 10% and 20% is wasted 30%

Source: Canalys channel partner survey, April 2018 (146 respondents)

This is creating opportunities for channel partners, as more organizations are migrating to public cloud services and opting for multiple providers while integrating them with their existing IT infrastructure. "The main role for channel partners after migrating and integrating customer workloads to a hybrid environment will be giving them greater visibility into available cloud resources to optimize use. This will be driven by analytics and, in future, machine learning to identify the optimal cloud package or subscription. But the skills needed for workload cloud migration, consumption monitoring, billing analytics, cloud consultation and integration services are in short supply," said Liu.

For more information, please contact:

Canalys EMEA: +44 118 984 0520 Matthew Ball: matthew_ball@ +44 118 984 0535

Canalys APAC (Shanghai): +86 21 2225 2888 Daniel Liu: daniel_liu@ +86 21 2225 2817

Canalys APAC (Singapore): +65 6671 9399 Jordan Mari De Leon: jordan_mari_deleon@ +65 66 719 397

Canalys Americas: +1 650 681 4488 Alex Smith: alex_smith@ +1 650 681 4486

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About Canalys

Canalys is an independent analyst company that strives to guide clients on the future of the technology industry and to think beyond the business models of the past. We deliver smart market insights to IT, channel and service provider professionals around the world. We stake our reputation on the quality of our data, our innovative use of technology and our high level of customer service.

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Copyright ? Canalys 2018. All rights reserved. Americas: Suite 317, 855 El Camino Real, Palo Alto, CA 94301, US | tel: +1 650 681 4488 APAC: Room 310, Block A, No 98 Yanping Road, Jingan District, Shanghai 200042, China | tel: +86 21 2225 2888 APAC: 133 Cecil Street, Keck Seng Tower, #13-02/02A, Singapore 069535 | tel: +65 6671 9399 EMEA: Diddenham Court, Lambwood Hill, Grazeley, Reading RG7 1JQ, UK | tel: +44 118 984 0520

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